Fatcats Ignore Constitutional Rights

Oregon law enforcement officials and failed drug war diehards are in a desperate last-ditch effort to keep asset forfeiture funds flowing into police drug squad coffers. Oregon voters last November approved a referendum greatly restricting asset forfeiture and requiring that any seized funds be directed to drug treatment instead of law enforcement.

Law enforcement officials first tried to overturn the will of the voters in the courts. The Lincoln County drug task force filed suit, arguing that the successful initiative was unconstitutionally broad and that it violated federal asset forfeiture laws, but Marion County Circuit Court Judge Pamela Abernathy upheld the ballot measure’s legality in a ruling last week.

“She found that Measure 3 met the proper standards and will continue to be the law,” Geoff Sugerman, spokesman for Oregonians for Property Protection, told DRCNet.

While attorneys for the measure’s opponents vow to fight on, law enforcement is now turning to the legislature for succor. Oregon lawmakers are debating a bill that would create a new, second system of “criminal” asset forfeiture. Crafted by the Oregon District Attorneys Association, the Oregon Association of Chiefs of Police, and the Oregon Sheriff’s Association, House Bill 3642 would allow asset forfeiture to continue, merely raising the standard of proof to the “beyond a reasonable doubt” standard for criminal cases. And, crucially, it would allow police agencies to keep some of the seized booty to finance their own future drug operations.

Meanwhile, a bill that would adjust Oregon asset forfeiture statutes to bring them into compliance with the constitutional changes mandated by Measure 3 is tied up in the state Senate. (The implementation bill passed the House 46-1 last month.)

“We have been working in good faith to reach a consensus language that would bring the statutes into compliance,” said Oregonians for Property Protection member Floyd Prozanski. “We thought we had agreement on that, but we found out just a few days ago that some people involved in the process wanted to link the civil forfeiture bill that would correct the shortcomings of the statute, to the passage of a criminal forfeiture bill,” Prozanski told DRCNet.

“They’re holding it hostage on the Senate side,” added the three- term former state legislator.

Sugerman told DRCNet that while the passage of the implementation legislation is not necessary for Measure 3′s constitutional changes to take effect, it does provide a backstop in the event that an appeals court overturns the Lincoln County case. “If we codify these provisions into law, then even were we to lose on appeal, the provisions would still control civil asset forfeiture.”

“Although we oppose ‘criminal’ forfeiture as unnecessary, we have continued to negotiate on it with the understanding that it might pass. If it does pass, we want to make sure that it carries the same protections as Measure 3. The bill has gone from three pages to 33, and there are many issues we think it important to consider, especially the proceeds issue.”

David Fidanque, executive director of the American Civil Liberties Union of Oregon, told DRCNet his organization has no philosophical objection to criminal asset forfeiture. “We’ve taken the position that forfeiture should rightly be part of the criminal process,” said Fidanque. “We’ve always objected to civil forfeiture on the grounds it gave government officials too much power and didn’t protect the interests of defendants and innocent third parties.”

But Oregon police are hoist by their own petard, Fidanque said. “Two years ago, there was a legislative proposal to reform civil forfeiture. Law officials said ‘no way we’re not interested.’ They were not even interested in a slightly higher standard of proof,” said Fidanque. They had their chance to support reform. “Now, after Measure 3 was approved, the link between forfeiture proceeds and those who seized them has been severed. And with this criminal asset forfeiture bill, police will have an even higher burden of proof to overcome than was contemplated by the legislature.”

Fidanque also told DRCNet that negotiations on the criminal asset forfeiture bill were moving forward. “I think we’ve reached a tentative agreement on a formula for allocating forfeiture proceeds. There is consensus at this point that the amount for treatment will be equivalent to the amount for law enforcement.”

Law enforcement bureaucrats have been complaining that they could not continue to function at the same enforcement levels without the funds they derive from asset forfeiture.

“When you withdraw a funding stream, cities and counties aren’t going to be able to backfill that loss, so some of these teams will cease to operate and others will be greatly reduced,” Marion County District Attorney Dale Penn told the Register-Guard.

“That’s right,” Prozanski told DRCNet. “Voters wanted two things out of this — they wanted a criminal conviction before asset forfeiture and they wanted to break the funding mechanism of these task forces. We have not argued that asset forfeiture should be completely abolished; we just wanted appropriate checks and balances to keep inappropriate conduct from occurring,” he added. “Unfortunately, too many people in law enforcement are following the money instead of doing the right thing.”

Sugerman of Oregonians for Property Protection agreed that police are concerned about funding their drug squads, but questioned the impact of asset forfeiture reform on their ability to do so.

“There is one and only one reason that they brought forth this bill,” he told DRCNet. Easy money. “They want the proceeds.”

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Arts & Letters

Geonomics is …

a way to redirect all the money we spend on the nature we use – trillions of dollars annually. We can’t pay the Creator of sites and resources and are mistaken to pay their owners this biggest stream in our economy. Instead, as owners we should pay our neighbors for respecting our claims to land. Owners could pay in land dues to the public treasury, a la Sydney Australia’s land tax, and residents could get back a “rent” dividend, a la Alaska’s oil dividend. We’d pay for owning sites, resources, EM spectrum, or emitting pollutants into the ecosphere, then get a fair share of the recovered revenue. The economy would finally have a thermostat, the dividend. When it’s small, people would work more; when it’s big, they’d work less. Sharing Earth’s worth, we could jettison counterproductive taxes and addictive subsidies. Prices would become precise; things like sprawl, sprayed food, gasoline engines, coal-burning plants would no longer seem cheap; things like compact towns, organic foods, fuel cells, and solar powers would become affordable. Getting shares, people could spend their expanded leisure socializing, making art, enjoying nature, or just chilling. Economies let us produce wealth efficiently; geonomics lets us share it fairly.

of interest to Dave Lakhani, President Bold Approach (Mar 8) and Matt Ozga (Jan 29): “I write for the Washington Square News, the student run newspaper out of New York University. Geonomics seems like it has great significance, especially in this area. When was geonomics developed, and by whom?”
About 1982 I began. Two years later, Chilean Dr Manfred Max-Neef offered the term geonomics for Earth-friendly economics. In the mid-80s, a millionaire founded a Geonomics Institute on Middlebury College campus in Vermont re global trade. In the 1990s, CNBC cablecast a show, Geonomics, on world trade as it benefits world traders. My version of geonomics draws heavily from the American Henry George who wrote Progress & Poverty (1879) and won the mayoralty of New York but was denied his victory by Tammany Hall (1886). He in turn got lots from Brits David Ricardo, Adam Smith, and the French physiocrats of the 1700s. My version differs by focusing not on taxation but on the flow of rents for sites, resources, sinks, and government-granted privileges. Forgoing these trillions, we instead tax and subsidize, making waste cheap and sustainability expensive. To quit distorting price, replace taxes with “land dues” and replace subsidies with a Citizens Dividend.
Matt: “This idea of sharing rents sounds, if not explicitly socialist, at least at odds with some capitalist values (only the strong survive & prosper, etc). Is it fair to say that geonomics has some basis in socialist theory?”
A closer descriptor would be Christian. Beyond ethics into praxis, Alaska shares oil rent with residents, and they’re more libertarian than socialist. While individuals provide labor and capital, no one provides land while society generates its value. Rent is not private property but public property. Sharing Rent is predistribution, sharing it before an elite or state has a chance to get and misspend it, like a public REIT (Real Estate Investment Trust) paying dividends to its stakeholders – a perfectly capitalist model. What we should leave untaxed are our sales, salaries, and structures, things we do produce.

a POV that Spain’s president might try. A few blocks from my room in Madrid at a book fair to promote literacy, Sr Zapatero, while giving autographs and high fives to kids, said books are very expensive and he’d see about getting the value added tax on them cut down to zero. (El Pais, June 4; see, politicians can grasp geo-logic.) But why do we raise the cost of any useful product? Why not tax useless products? Even more basic: is being better than a costly tax good enough? Our favorite replacement for any tax is no tax: instead, run government like a business and charge full market value for the permits it issues, such as everything from corporate charters to emission allowances to resource leases. These pieces of paper are immensely valuable, yet now our steward, the state, gives them away for nearly free, absolutely free in some cases. Government is sitting on its own assets and needs merely to cash in by doing what any rational entity in the economy does – negotiate the best deal. Then with this profit, rather than fund more waste, pay the stakeholders, we citizenry, a dividend. Thereby geonomics gets rid of two huge problems. It replaces taxes with full-value fees and replaces subsidies for special interests with a Citizens Dividend for people in general. Neither left nor right, this reform is what both nature lovers and liberty lovers need to promote, right now.

the Great Green Tax Shift maxed out”
Economically, taxing pollution and depletion does reduce pollutants and extracts – and thus the tax base; plus such taxes are regressive, requiring a safety net. On the other hand, collecting site rent is progressive and generates a revenue surplus payable as a dividend to residents, which can serve as the safety net.
Environmentally, taxes on waste and extraction do not drive efficient use of land, as does getting site rent. Better settlement patterns do reduce extraction upstream and pollution downstream.
Politically, green fees have less impact if applied locally; local is where grassroots movements have more impact. Yet getting rent usually entails shifting the property tax (or charging user fees), the province of local jurisdictions; both mayors and city voters have been known to adopt a site-value tax.
Ethically, putting into practice “tax bads, not goods” skirts the issue of sharing Mother Earth which collecting rent confronts head on. Since nothing is fixed until it’s fixed right, ultimately, greens must lead humanity into geotopia where we all share the worth of Mother Earth.

a scientific look at how we divvy up the work and the wealth, how some of us end up with too much or too little effort or reward. That’s partly due to Ricardo’s Law of Rent, showing how wasteful use of Earth cuts wages. And it’s partly due to how a society’s elite runs government around like water boys, dishing out subsidies and tax breaks. While geonomists look political reality right in the eye, without blinking, conventional economists flinch. When Paul Volcker, ex-chief of the Federal Reserve, moved on to a cushy professorship at Princeton cum book contract, the crush of deadlines bore down. So Volcker asked a junior associate to help with the book. The guy refused, explaining that giving serious consideration to policy would ruin his academic career. The ex-Fed chief couldn’t believe it and asked the department chair if truly that were the case. That head honcho pondered the question then replied no, not if he only does it once. And economics was AKA political economy!

what you do when you see economies as part of the ecosystem, following feedback loops and storing up energy. Surplus energy – fat or profit – enables us to produce and reproduce. To recycle society’s surplus, the commonwealth, geonomics would replace taxes with land dues (charged to users of sites and resources, in-cluding the EM spectrum, and extra to polluters), and replace subsidies with rent dividends to citizens (a la Alaska’s oil dividend). Without taxes and subsidies to distort them, prices become precise, reflect accurately our costs and values; then, motivated by no more than the bottom line, both producers and consumers make sustainable choices. While no place uses geonomics in its entirety, some places use parts of it, most notably a shift of the property tax off buildings, onto locations. Shifting the property tax drives efficient use of land, in-fills cities, improves the housing stock, makes homes affordable, engenders jobs and investment opportunities, lowers crime, raises civic participation, etc – overall it makes cities more livable. Geonomics – a way to share the bounty of nature and society – is something we can work for locally, globally, and in between.

the study of the money we spend on the nature we use. When we pay that money to private owners, we reward both speculation and over-extraction. Robert Kiyosaki’s bestseller, Rich Dad’s Prophecy, says, “One of the reasons McDonald’s is such a rich company is not because it sells a lot of burgers but because it owns the land at some of the best intersections in the world. The main reason Kim and I invest in such properties is to own the land at the corner of the intersection. (p 200) My real estate advisor states that the rich either made their money in real estate or hold their money in real estate.” (p 141, via Greg Young) When government recovers the rents for natural advantages for everyone, it can save citizens millions. Ben Sevack, Montreal steel manufacturer, tells us (August 12) that Alberta, by leasing oil & gas fields, recovers enough revenue to be the only province in Canada to get by without a sales tax and to levy a flat provincial income tax. While running for re-election, provincial Premier Ralph Klein proposes to abolish their income tax and promises to eliminate medical insurance premiums and use resource revenue to pay for all medical expense for seniors. After all this planned tax-cutting and greater expense, they still expect a large budget surplus. Even places without oil and gas have high site values in their downtowns, and high values in their utility franchises. Recover the values of locations and privileges, displace the harmful taxes on sales, salaries, and structures, then use the revenue to fund basic government and pay residents a dividend, and you have geonomics in action.

not a panacea, but like John Muir said, “pull on any one thing, and find it connected to everything else.” Recall last month’s earthquake in El Salvador. We felt it and its formidable after-shocks in Nicaragua. Immediately afterwards, my host nation, one of the poorest in the Western Hemisphere, sent aid to its Central American neighbor. The Nica newspapers carried photos of the devastation. They showed that the cliff sides that crumbled had had homes built on them while the cliffs left pristine withstood the shock. Could monopoly of good, safe, flat land be pushing people to build on risky, unstable cliffs? If so, that’s just one more good reason to break up land monopoly. What works to break up land monopoly, history shows, is for society to collect the annual rental value of the underlying sites and resources. That’d spur owners to use level land efficiently, so no one would be excluded, forced to resort to cliffs. To prevent another man-induced landslide is yet another reason to spread geonomics.

a way to have everybody pulling on the same end of the rope. Last summer’s expansive forest fires shed light on growing class resentment in the West. Old log-gers and ranchers rankled at the new urgency to stamp out the blazes that threatened the recent Aspenesque settlers. The newcomers expected working class firemen to make protecting their expensive homes top priority. (Chr Sci Mntr, Spt 7) The tinder for this envy? Rich people moving in bid up the price of land, making it hard to afford by people on the margin. The fault really lies with our system of privatizing land value. If this rising value were collected by land dues and shared by rent dividends – the essence of geonomic policy – who’d complain? The more people move in, the higher the land value, and the fatter the dividend paid to residents. Then people on the margin might go out of their way to invite rich outsiders in.

close to the policy of the Garden Cities in England. Founded by Ebenezer Howard over a century ago, residents own the land in common and run the town as a business. Letchworth, the oldest of the model towns, serves residents grandly from bucketfuls of collected land rent (as does the Canadian Province of Alberta from oil royalty). A geonomic town would pay the rent to residents, letting them freely choose personalized services, and also ax taxes. Both geonomics and Howard were inspired by American proto-geonomist Henry George. The movement launched by Howard today in the UK advances the shift of taxes from buildings to locations. A recent report from the Town and Country Planning Association proposes this Property Tax Shift and their journal published research in the potential of land value taxation by Tony Vickers (Vol. 69, Part 5, 2000). (Thanks to James Robertson)